Magazine Article | January 17, 2012

Do You Look Like Every Other VAR?

By Jay McCall, Networking and Managed Services Editor, Business Solutions magazine.

As I interview VARs each month for Business Solutions magazine, one of the challenges I face is finding the one or two traits or behaviors that separate a successful VAR from a mediocre one. On the surface, most VARs look very similar: They sell hardware, which they bundle with software, and they may even sell their solution as a subscription. The hardware and software you resell also sounds very similar to what your competitors offer. If you make the novice mistake of spending too much time up front talking to prospects about specific products, you’ll quickly become a “me, too” reseller.

So, how effectively are you distinguishing yourself from your competitors? According to Alex Rogers, CEO of CharTec, a BDR (backup and disaster recovery) and HaaS (hardware-as-a-service) vendor, the way VARs typically discover they’re not standing out from their competitors is by noticing declining profit margins. Such VARs also find themselves in difficult RFP battles where they’re pitted against competitors and forced to give away some part of their offering just to earn a client’s business. Whether you sell networking, point of sale, storage, security, managed services, or payment processing solutions, you should heed Rogers’ warning signs.

One trait I’ve observed over the years as I think about successful VARs I’ve interviewed is that they’re constantly learning — reading business books, attending conferences and trade shows, and networking with other VARs. One example that stands out is a channel company called EDTS, which is featured in this month’s issue on page 22. This 40-employee reseller, founded by Charles Johnson in 1999, made the Inc. 5000 list of the fastest-growing privately held companies in the country. One of the secrets Johnson shared with me that turned his business around and helped him separate himself from his competitors was following a principle he applied after reading Mastering the Rockefeller Habits by Verne Harnish. Another major change that led to his success came from attending a vendor partner event, where he was challenged to not be a bottleneck to his company’s growth.

In addition to these two examples in our current issue, one other example I’d like to suggest regarding how you can stand out from the crowd comes from the late Steve Jobs. If you haven’t read his biography, I’d highly recommend doing so. If you would prefer the CliffsNotes version, I’d recommend reading author Malcolm Gladwell’s commentary on the book, which appeared in the New Yorker and is titled “The Tweaker.” The punch line is this (spoiler alert): You don’t have to invent something totally new to be a success. You can be equally successful by paying attention to what’s currently available and making improvements upon it. As you apply these principles to your business, you can move away from the dwindling margins that being a “product pusher” brings and toward the profitability status of a valueadded reseller or, if you prefer, a trusted business advisor.